Health and Indigenous Affairs Correspondent

Australian Medical Association president Brian Owler has warned the Coalition's proposed $7 Medicare co-payment could destroy recent gains made in indigenous health by deterring people from seeking care.

The annual closing the gap report delivered by Prime Minister Tony Abbott in February showed the nation was on track to halve the gap between indigenous and non-indigenous infant mortality within the decade.

It also showed some improvement in indigenous life expectancy, but warned progress would need to accelerate considerably in order to meet the target of closing the life expectancy gap between indigenous and non-indigenous Australians by 2031.

Speaking to Fairfax Media in Alice Springs where he was touring health facilities, Associate Professor Owler said there was a risk that the proposed $7 fee and $160 million in other cuts to indigenous health programs would cause progress ''not only to stall but go backwards''.

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''I think it's really important that we continue that focus and we don't take our foot off the pedal,'' Associate Professor Owler said.

''There is just no way that anyone who knows anything about indigenous health can say that a $7 co-payment would not have a devastating effect on people attending clinics,'' he said.

John Boffa, the chief medical officer public health of Central Australian Aboriginal Congress, which is the largest Aboriginal medical service in the Northern Territory, said it would not impose a fee.

''It would lead to people who really need healthcare not coming to the healthcare,'' Associate Professor Boffa said.

''We can't afford to have that happen, so we wouldn't charge the co-payment,'' he said.

By waiving the co-payment, the service would receive $14.10 less from Medicare than it does currently because it would lose a $9.10 bulk-billing incentive as well as suffer a $5 cut to the Medicare rebate for the visit.

''The cost we would have to absorb for the Alice Springs part of our service would be around half a million dollars a year, and for the bush part of our service, probably $300,000.

''So we'll have to absorb that cost, internally, which could mean that we have to cut some services and programs,'' Associate Professor Boffa said.